Non Profit Directors and Officers are
legally responsible for the day-to-day
decision-making of their organization. These
board members can be held personally liable
for any breach of duty.
THE DUTIES OWED BY DIRECTORS AND
OFFICERS INCLUDE THE RESPONSIBILITY THAT IS
OWED TO THE ORGANIZATION ITSELF, ITS
MEMBERS, EMPLOYEES AND THE GENERAL PUBLIC.
THE DIRECTORS OWE THREE SPECIFIC DUTIES: THE
DUTY OF CARE, THE DUTY OF LOYALTY AND THE
DUTY OF OBEDIENCE
•Duty of Care – requires Directors
and Officers to act prudently and
reasonably in regard to the
management of the organization’s
affairs
•Duty of Loyalty – prohibits
Directors and Officers from using
their position in the organization
to further their own personal
interest
•Duty of Obedience – requires
Directors and Officers to ensure
that the organization is run in
accordance with it’s charter and
bylaws, and that the organization
complies with applicable laws
•Establish a mission and purpose for the
organization and articulate goals
•Establish a mission and purpose for
the organization and articulate goals
•Select a chief executive and
establish his or her responsibilities
•Ensure effective organizational
planning, establish programs and
services consistent with the
organization’s mission and assist in
implementing and monitoring the plan’s
goals
•Ensure adequate resources so that
the organization may fulfill its mission
•Provide financial oversight and
assist in developing an annual budget
and ensuring that proper financial
controls are in place
•Ensure legal and ethical integrity
and maintain accountability for
adherence to legal standards and ethical
practices
•Establish procedures to ensure that
each board member understands and
complies with his or her duties as a
board member
•Serve as an advocate for the
organization and enhance their public
standing
•Support the chief executive and
assess his or her performance and
monitor the conduct of the staff to
ensure the organization is being
properly managed
•Recruit and orient new board members
and assess board performance
Non Profit Directors and Officers must
always act for the benefit of their
organization, avoid any conflicts of interest
and exercise the utmost skill and care in
decision-making. Any perceived breach of these
duties can result in a suit that will at the
very least incur defense costs. You could be
sued by employees, members, volunteers and
donors.